Borrowers Loans
The Fund focuses primarily on providing secured loans for construction and development projects. These Loans are generally be secured by a first ranking mortgage over the property the subject of the project. The Investment Manager will also consider Loans secured by a second ranking mortgage provided that the total value of all Loans secured by a second ranking mortgage does not exceed 10% of the assets of the Fund. Before accepting second ranking mortgage security, the Investment Manager will ensure that a Priority Agreement is entered into with any first ranking mortgagee.
The Fund may also engage in corporate funding opportunities such as capital equipment leasing finance secured by a first or second ranking mortgage over real property and/or security interests over business assets.
The Investment Manager will assess Loans in accordance with the Lending Policies.
Construction and Development of
Loan purposes will also include:
- Residential houses.
- Residential strata titled home units, villas and townhouses.
- Industrial premises, including strata titles.
- Retail premises, including shopping centres and strata / titles.
- Mixed use developments.
- Subdivisions approved for development for residential, rural residential, commercial or industrial purposes.
- Purchase of retail / commercial / industrial premises that are primarily serviced by rental income generated by the property.
- Purchase of improved or unimproved investment real property.
Corporate funding may include the following
- Short term funding for businesses supported by appropriate real property security or security interest over business assets.
- Lease finance arrangements for business equipment.
- Corporate debt supported by a security interest over the business assets.
- Business Acquisition finance supported by a security interest over the business assets.
The Fund will not make Loans that are
The Fund will not make loans that are unsecured or highly specialized without an apparent ‘highest and best use strategy’ allowance when approving the loan amount.
Borrowers may include-
- individuals over the age of 18 years.
- sole traders.
- companies.
- any individual or company as trustee for a trust.
- partnerships.
- incorporated and unincorporated associations.
- foreign borrowers that meet one of the above categories.
The Fund will also not make Loans that are
The Fund will not make loans that are regulated by the National Consumer Credit Protection Act 2009 (Cth).
In addition, the Fund will not make Loans to –
- individuals less than 18 years old.
- any borrower with whom the Fund has had a previous unsatisfactory relationship.
- undischarged bankrupts.
- incorporated and unincorporated bodies that have been declared insolvent.
- any form of group title scheme.
- political organisations.
- persons currently serving prison sentences
Loan applications are considered on
Loan applications are considered on their individual merits but generally must meet the following objectives-
- to provide funding to Borrowers of sound reputation, integrity and capacity;
- to ensure the Fund receives a commercially acceptable return in relation to the degree of lending risk involved; and
- to highlight all the risks involved and mitigate where possible to ensure effective management.
Costs and Documentation
Borrowers will be liable for all direct costs associated with a Loan.
Direct costs include –
- specific legal, tax and accounting costs and outlays;
- valuation and evaluation fees;
- quantity surveyor and like professional fees;
- stamp duty and other specific taxes and charges including, where applicable GST;
- insurances;
- registration fees; and
- search fees.
The ongoing costs of managing each facility are borne by the Fund. As such, the Investment Manager charges a Loan establishment fee which is payable by the Borrower.
The documentation of all Loans will be undertaken by one of the Fund’s legal adviser(s), chosen from a panel of legal firms with experience in documenting these types of Loans.